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On the Third Hand: Happy watchdog

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An agency in charge of the Internal Revenue Service (IRS) recently concluded that the IRS got part of the new public health insurance exchange system working just fine.

Investigators at the Treasury Inspector General for Tax Administration (TIGTA) found that, back in early October 2013, when the U.S. Department of Health and Human Services (HHS) was still using flint knives and abacuses made of conch shell beads to torture the people trying to enroll in exchange plans, the IRS had working computers.

The IRS computers told the HHS exchange computers, accurately, what IRS files said about exchange plan applicants. IRS computers also were good at using applicant information to calculate exchange plan premium subsidy levels.

See also: Watchdog: IRS PPACA exchange systems worked well

Some readers noted that TIGTA looked at only about 100,000 transactions and wondered whether that sample was big enough. For me, another issue is when the transactions occurred.

On the one hand, it’s great that the IRS was on the ball enough to have smoothly working exchange program computers in October.

On the other hand, in October, HHS and several of the state-based exchanges did not have smoothly working exchange enrollment systems. The volume of requests for information coming to the IRS computers was low. It would be interesting to see the results for a similar TIGTA review for December, when application volume spiked.

On the third hand: This is another bright shiny PPACA implementation object. Our government does actually have the capacity to set up information systems, and big programs that operate smoothly. 

The fundamental questions about whether PPACA will work, as always, are these:

  • Are the politically active players in the U.S. health care system willing to pay to move away from aiming most of our de facto health care rationing efforts at the sick and the working poor – or will they be subject to effective oversight by regulators that will make them do that?
  • Are insurers, doctors and hospitals willing to change the cherished ways of doing business that make each health care service cost so much more in the United States than in Europe – and so much more in some U.S. facilities than in others? (Change Healthcare, for example, recently reported that insurers paid more than three times as much for vaginal deliveries at some U.S. facilities than at others. That figure represents variation in the amounts the insurers actually paid, not the billed charges.)
  • Are U.S. health care  prices really that much higher than in Europe, or are differences in how we organize our society (example: how we account for the cost of college education and medical education) giving us a false sense of how much fat we can cut out of our health care finance and delivery systems?

If the answers to those questions allow for systematic health care reform, either this PPACA will work, or some new version of PPACA will work.

If the answers to those questions don’t allow for systematic health care reform, then it won’t matter how smoothly the exchange computers do or don’t work. We’ll just have to keep waiting for the current health finance system to explode and create a crater conducive to the creation of new forms of health care finance life.

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